Bitcoin Price Graph

The price of bitcoin exceeded $12,000, while Chinese yuan fell to an 11-year low. Tom Lee from Fundstrat believes that the US-China trade war will make bitcoin a more popular means of accumulating and maintaining value.

The Chinese currency fell to an 11-year low loosing 7% of its price and dropping to $7. Since the official rate of the renminbi is declared by the People’s Bank of China, which plays the role of the central bank in the country, in fact, Chinese authorities could have deliberately collapsed the national currency to make goods from the United States too expensive, and Chinese, on the contrary, more affordable. China is manipulating the exchange rate of its own currency, wrote US President Donald Trump on Twitter:

“China dropped the price of their currency to an almost a historic low. It’s called “currency manipulation.” Are you listening Federal Reserve? This is a major violation which will greatly weaken China over time!”

The stock market reacted to the Chinese currency depreciation by lowering the price of stocks of US exporters, whose sales are expected to decline against cheaper goods from China.

Along with the renminbi dropping, the price of bitcoin continued to rise and exceeded $12,000. According to Fundstrat strategist and co-founder Tom Lee, US-China trade war scares market and they are trying to find a “safe haven” to preserve their assets. In addition to gold, they are increasingly turning to bitcoin. Thus, the trade conflict between China and the United States will lead to an increased demand and price growth of bitcoin.

The growth of the cryptocurrency rate will also be triggered by rate cuts by the US Federal Reserve. According to Lee, bitcoin has every chance of rising in price to $20,000 by the end of 2019.